Seeking Alpha

katetrades'  Instablog

katetrades
Send Message
I'm a currency trader with more than 10 years of trading experience. My trading framework involves both fundamental and technical analysis. Currently I'm working as a market analyst at Forex and CFD broker Trader's Way.
My company:
Trader's Way
  • Trade Setup Of The Day: Short GBP/USD (February 21, 2013) 0 comments
    Feb 21, 2013 4:05 AM

    GBP/USD just broke below the long-term support at 1.5350 and the next area of support is around 1.5000 then at 1.4300. The pound has been selling off aggressively lately as the United Kingdom has been printing weak data and the BOE emphasized its commitment to weak monetary policy at the expense of stronger inflationary pressures. This puts the British economy at risk of stagflation, which could be more damaging to growth later on.

    On the other side of the fence, the U.S. dollar has been enjoying a strong rally for the past few trading sessions after the FOMC meeting minutes revealed that the Fed was actually considering overlooking its employment and inflation targets. Recall that Fed Chairman Bernanke said previously said that the economy has stalled and that the expansion will just be moderate. However, in their latest monetary policy meeting minutes, policymakers showed more confidence in the economy and even suggested withdrawing asset purchases soon.

    The pair's breakdown below 1.5350 represents a pretty significant signal that pound bulls are no longer willing to defend the support zone. Unless Fed officials retract their recent hawkish remarks, the U.S. dollar could continue to be boosted by upbeat monetary policy expectations.

    Meanwhile, weaker than expected figures from the U.K. could push GBP/USD all the way down to the 1.5000 major psychological support. If that level still breaks, GBP/USD could keep selling off until the next lows around 1.4300.

    (click to enlarge)

    by Kate Curtis of Trader's Way

    Themes: Forex
Back To katetrades' Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (0)
Track new comments
Be the first to comment
Full index of posts »
Latest Followers
Posts by Themes
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.